Shares portfolio: Summer sun shines on Thomas Cook

At the height of summer, Thomas Cook is getting in the holiday mood with an optimistic report on its shares.

Banks are also enjoying some time in the sun, with Taxpayer-owned Royal Bank Of Scotland set to complete reporting week tomorrow.

The Standard's City team rates which stocks to buy and sell, with analysis on the top traders' deals and what to expect from the markets.

BUY: Thomas Cook

We're all going on a summer holiday and JPMorgan advises investors to buy shares — not just flights — in travel company Thomas Cook.

"We are cautiously optimistic on the mid-term outlook for the sector," analysts say. "Although consumer confidence is falling in the UK and flat in Europe, we forecast employment to remain robust and consumer/industry surveys suggest summer holidays will not be forgone."

"Management continue to control credit and yields tightly. However, we continue to believe customer borrowing behaviour will remain cautious during the rest of 2010," Citi analyst Hugo Mills writes.

But he flags up problems ahead: "While the dividend yield may attract some investors, we remain concerned about the outlook and the potential for further downgrade risk."

This informs Citi's sell rating on the stock. It names a target price of 770p — knocked down from the previous 800p level — on shares in the subprime lender.

HOLD: Bloomsbury

Shares in Harry Potter publisher Bloomsbury have enjoyed a "useful rally", outperforming the market by around 16% over a three-month period, according to Altium Securities.

The shares are now within 1.5% of Altium's 127p price target after what analysts call a "pleasing" interim management statement which flagged a "solid start to the year", including encouraging trading in the UK and US, and signs of an improvement in the profitability of the group's sometimes-problematic German business.

But the share price increase means Altium downgraded the stock from buy to hold.

Trader talk

Value specialist Weiss Asset Management has taken a major chunk of troubled investment trust Invesco English & International as it readies itself to wind up.

The company's Brookdale Global Opportunity fund increased its stake from 2.56 million shares to 6.23 million or 29.5% worth about £13 million. Shares in the trust are trading at a 14% discount to net asset value, meaning a substantial one-off gain if the portfolio is liquidated at anything near book price.

Boston-based Weiss Asset Management was founded by Andrew Weiss, one of America's leading economists, as measured by citations of his academic work. Invesco English & International lost more than 50% of its value in 2008 through a combination of a meltdown in its small-cap sector and heavy investor redemptions.

The trust slashed its borrowing and has since seen performance bounce back but at £48 million, remains too small to be economical.

Taxpayer-owned Royal Bank Of Scotland will complete bank reporting week when it posts its highly anticipated half-year results. Analysts unanimously predict RBS will break back into the black, but they differ in their actual profit projections. While some City figures have pencilled in £100 million, others are gunning for nearer £200 million pre-tax profit. Any profit at all would bring to an end two years of multi-billion pound losses. This week RBS confirmed plans to sell 318 branches to rival Santander for an estimated £1.65 billion.

Rare stamp dealer Stanley Gibbons posts first-half figures. In March, the firm — which also flogs thousands of valuable autographs on its website and at auctions — said low interest rates and lack of confidence in the markets were enticing growing numbers of investors to move into stamps. For 2009, it posted an 11% rise in annual profits to £4.1 million and set out extensive plans to expand its operations into China. Shareholders will be looking for a progress update on those plans tomorrow.

The board of engineer Tomkins last month recommended a bid worth £2.9 billion by a consortium comprising US private equity firm Onex and the Canada Pension Plan Investment Board to its investors. Its suitors will find out just how well the firm is trading when it posts its first-half figures.